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February 2, 2011 - Canadian Press
source Mattel 4Q revenue rises 9 per cent, but Mattel plans to raises prices as costs increase By Mae Anderson (CP) – Feb 2, 2011 NEW YORK, N.Y. — It was a doll of a holiday quarter for Mattel. Barbie, American Girl and new Monster High dolls all sold strongly for the nation's largest toy maker during the quarter, sending revenue up 9 per cent. The growth outpaced the industry and likely its chief rival Hasbro, which earlier forecast a revenue decline for the quarter. Shares rose nearly 4 per cent in morning trading. The nation's largest toy maker said Wednesday net income edged down to $325.2 million or 89 cents per share, from $328.4 million, or 89 cents per share last year. Last year's quarter included a one-time tax benefit of 8 cents per share, however. Analysts expected 86 cents per share, according to FactSet. Revenue rose 9 per cent to $2.12 billion. Analysts expected net income of $2.07 billion. Barbie revenue rose 8 per cent, and Fisher-Price revenue rose 6 per cent. Mattel has seen a resurgence in its classic Barbie brand since it turned 50 in 2009, in part by garnering buzz for unconventional versions of the dolls, such as Barbie Video Girl, a Barbie with a video camera inside. In January, the company launched "Sweet Talkin' Ken," a Ken doll that has a built in microphone and can play back recordings in a "Ken" voice, as the original recording or in a high-pitched voice. Ken turns 50 this year. Mattel's new licenses with Thomas and Friends and World Wrestling Entertainment also have performed well Its line of "Monster High" dolls, which purport to be the offspring of famous monsters, were a "must-have" item during the holidays. CEO Bob Eckert said the company would "at least think about" a Monster High movie in 2012. This year, the company will have toys tied to "Cars 2" and "Green Lantern." Fisher-Price's revenue increase marks a turnaround for the brand, which has been weak in recent quarters. Core Fisher-Price revenue was flat, but gross sales, which also include Fisher-Price Friends and Power Wheels toys, rose 6 per cent to $775.8 million. Another bright spot was Mattel's entertainment business, which includes Radica electronic games, games and puzzles. Revenue in that unit rose 12 per cent. Revenue at Mattel's Wheels unit, which includes Hot Wheels, Matchbox, and Tyco remote-controlled vehicles, fell 4 per cent. American Girl revenue rose 8 per cent to $273.2 million. The company said inventory increased compared with a year ago, when the company held back due to uncertainty about the economy. Mattel, facing rising costs for resin, packaging, labour and shipping, as well as the strengthening Chinese currency, plans to raise prices in the second quarter by mid- to high-single-digit percentages. It is also spending "at a pretty high rate" on its long-running litigation MGA over the Bratz doll property. The second round of a copyright infringement case should last three or four months, Eckert said. For the year, Mattel Inc., based in El Segundo, Calif., said net income rose 30 per cent to $684.9 million, or $1.88 per share, while revenue rose 8 per cent to $5.86 billion. Toy makers can pull in more than a third of their yearly revenue during the holidays. Research firm NPD Group said last week that overall sales during the holiday quarter, which ended in December, rose 3 per cent to $10.2 billion. Mattel's largest rival, Hasbro, reports its quarterly results Monday. The company, based in Pawtucket, R.I., warned in January that its revenue will likely fall in the fourth quarter in year after a sharp slowdown in demand late in the holiday season. Mattel separately declared a dividend of 23 cents per share, payable on March 11 to shareholders of record as of Feb. 24. Shares rose 86 cents, or 3.6 per cent, to $25.01 in morning trading, nearer to the high end of its 52-week range of $19.67 to $26.70. Copyright © 2011 The Canadian Press. All rights reserved. Category:Press coverage